NZ dollar set to continue decline
5:50 PM Tuesday Nov 16, 2010

The New Zealand dollar eased today and looked likely to continue declining as the US dollar regained some strength.

By 5pm, the kiwi was at US77.33c, up from US76.92c late yesterday afternoon but softer than its US77.77c high earlier this morning.

"After surging to 30-month highs near US80c early in October, the NZD/USD has lost some of its lustre over the last week or so," said BNZ currency strategists.

"This reflects falling NZ-US interest rate differentials, deteriorating risk appetite and the risks to NZ's kiwifruit industry from a disease outbreak."

Concerns about sovereign debt have returned to the fore, and Chinese policy tightening has also added to worries about global growth.

The US dollar hit a six-week high against the euro today on the back of rising US Treasury yields as investors sold bonds in a seasonal rush.

Nervousness about the euro was stoked by meetings of European finance officials amid debt problems in Ireland and Portugal.

More here.